Measured easing in North America: The Federal Reserve (Fed) cut interest rates in December amid internal divisions, signaling a higher bar for future easing with policy near neutral. While the Fed proj- ects one more cut in 2026, we expect a prolonged pause at least through May when Fed Chair Powell’s term ends, unless labor weakness forces risk-man- agement cuts. In Canada, although we think the Bank of Canada (BoC) has reached its terminal rate, the future of the US-Mexico-Canada trade agreement could play a role in determining policy. Markets expect the BoC to hike by the fourth quarter. Central banks in Europe ... (full story)